Guest Comments: Doha in December

Larry McClendon | Nov 20, 2008

During my tenure as chairman of the National Cotton Council, I have represented the industry in several important meetings across the United States and around the world. I have participated in numerous discussions concerning international trade with many of those focused on the Doha Round trade negotiations.

U.S. agriculture is being asked to voluntarily forgo a large portion of the commodity programs that operate as a safety net for U.S. farmers. In October 2005, the United States offered a reduction of $26 billion in overall trade distorting support to agriculture. In return, we were promised increased market access for U.S. agricultural exports.

I spent five intense days in Geneva this past July monitoring the ministerial-level discussions that occurred there. On the first day of those talks, the United States offered an even larger cut of $33 billion in U.S. agricultural support. Two or three days later, WTO Director General Pascal Lamy tabled his proposed agreement, which included a $34 billion cut in U.S. support.

We were there with the entire U.S. negotiating team, including U.S. Trade Representative Susan Schwab, Chief Agricultural negotiator Joe Glauber and Under Secretary of Agriculture Mark Keenum, along with many other USDA and USTR professionals.

When I reviewed the Lamy proposal, I was amazed it would even be considered. It contains significant loopholes on market access, would have allowed countries to use safeguard remedies to increase tariffs beyond current levels and would have created a further imbalance in market access between developed countries and developing countries.

The Lamy text offered no tangible benefits to U.S. agriculture in terms of developing country market access. If that proposal had been adopted, the United States would have had to give up $36 billion in U.S. agricultural spending for virtually no payback at all. I know for sure that the Lamy text would not help increase cotton exports one bit to China — the largest single producer and user of cotton in the world.

But the whole of U.S. agriculture would not fare much better. The exemptions for developing countries ensure that U.S. agriculture will not have additional access to the fastest growing agricultural markets in the world. While the Lamy text was a serious problem as far as I was concerned, India and a few other developing countries insisted on significantly less access to their markets and even larger reductions in U.S. agricultural support. Our trade negotiators did the right thing when they refused.

Now, weeks after we have elected a new president and many senior Bush administration officials have begun to move into the private sector, there is serious discussion about convening another meeting of ministers so that a Doha agreement can be reached before the end of the year — before the new president can have anything to say about it. It seems certain that should such a meeting occur, the negotiation would start with the flawed Lamy text and, once again, the Unites States will be asked to make more cuts while receiving even less in market access gains.

There was a concerted, long, and thoughtful effort in July of this year to craft an agreement. I watched the intense pressure build for an agreement. I watched the U.S. negotiators bend far more than I would have; and then I watched them refuse to be pushed further.

None of the major trade negotiating countries has changed their positions since July. If a December meeting is held, and the Lamy text used as a starting point, the haste to conclude the negotiations would work against a balanced agreement and the new president will be saddled with a text that cannot pass Congress. I don’t think that is a good Christmas present for President-elect Obama, U.S. agriculture, or world trade.

Larry McClendon is a Marianna, Ark., producer and ginner who is serving as chairman of the National Cotton Council of America.